(L.OBJ. 4) Applying the direct write-off method to account for uncollectibles [10 min]
Sheena Stone is an attorney in Los Angeles. Stone uses the direct write-off method to account for uncollectible receivables.
At November 30, 2010, Stone’s accounts receivable totaled $21,000. During December, she earned revenue of $24,000 on account and collected $23,000 on account. She also wrote off uncollectible receivables of $1,440 on December 31, 2010.
Requirements
1. Use the direct write-off method to journal Stone’s write-off of the uncollectible receivables.
2. What is Stone’s balance of Accounts receivable at December 31, 20110? Does Stone expect to collect the total amount?
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